Economic Slowdown, Fewer Business Mergers

In 2019, 25 M&A files were submitted to the Costa Rican authorities, down from 40 in 2018, which can be attributed to the decline in economic activity.

Monday, February 3, 2020

Although in the second half of 2019 the Costa Rican economy began to report signs of recovery, last year was marked by a slowdown in the Monthly Index of Economic Activity (IMAE) and consumer uncertainty.

You may be interested in "Economic Slowdown: What Was No Longer Consumed?"

According to information from the Ministry of Economy, Industry and Trade (MEI), in 2016 and 2017 the Commission to Promote Competition (Coprocom) resolved 37 processes, in each year. Then, in 2018 the number of cases processed rose to 40, and in 2019 the figure fell to 25.

Mariana Castro, president of Coprocom, told that "... the decline in the economy's dynamism would be one of the reasons for fewer mergers and acquisitions."

For Sergio Wienik, CEO of Capital Financial Advisors, the market is still hungry, but "... the economic stagnation of recent years has caused buyers to apply more conservative valuations to target companies."

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